Posts Tagged ‘gambling statistics’

Gambling – The Activity of Business

As per the internal revenue service, the winnings in gambling is termed as an income. The losses are termed as tax deductible and this is applicable to taxpayers who itemize the particular deductions. The deductions in the loss are limited to the winnings of gambling. The loss in this area does not apply to the income deduction from the particular sources other than gambling.

IRS treatment

The IRS treats gambling as hobby of recreation. The enrolled job of the agent defines the tax deductions which are eligible. It is only the loss in the business activity that is deductible.

The reason being there is expectation for taxable profit for future. One needs to know what happens to the taxpayer who treats gambling as the profession. They have to select from enrolled list of agent so as to prove the activity for the business.

The tax court ruling

As per the tax court, the individual can qualify as a gambler despite pursuing the activity part time. The part time pursuits of business receive same treatment of tax as is the case with full time employment. All the expenses are deductible if part time gambling is tax classified.